The European Council and Parliament have reached a provisional political agreement to create new payments regulation which will enable retailers to offer cash withdrawals without a purchase.

The move forms part of plans to improve access to cash, particularly for people living in rural areas.

This service has been available in the UK for a number of years.

The Council said to prevent abuse, these withdrawals will require chip and PIN technology, with a maximum withdrawal limit of €150 or equivalent in national currency.

The regulation overhaul will see the existing payment services directive (PSD2) amended to create a “modern framework” for payments.

Under the new rules, companies providing card payments to merchants will also have to make clear the fees they charge for their services.

The European Council said that the new rules will be designed to better fight payment fraud, boost transparency on fees, increase consumer protection, and help promote technological innovation in payments.

“Today’s agreement marks a major step in the fight against payment fraud in the EU,” said Morten Bødskov, Danish minister for business, industry and financial affairs. “And by enhancing consumer protection, improving transparency, and fostering innovation, we are paving the way for a more secure, efficient, and consumer-friendly payment landscape for all Europeans.”

The Council and the European Parliament plan to continue working on the technical elements of the package before final adoption by co-legislators.

The regulatory revamp will also put in place a comprehensive anti-fraud framework that will help tackle increasingly common new forms of payment scams, such as “spoofing fraud”.

This type of fraud is where fraudsters impersonate a customer's payment service provider to trick the user into carrying out fraudulent financial actions.

Payment service providers (PSPs) will also have to share fraud-related information between themselves.

Payment account IBAN numbers will have to be checked against a corresponding bank account name before any transfer can take place, mirroring the existing process for instant payment transfers taking place in euro.

PSPs will be held liable should if they do not fulfil their obligations to use preventative anti-fraud tools.

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